Thinking about the cost of living
A loaf of bread cost around 10 cents in 1935. Today, that same loaf will run you at least $2 on sale in mainstream supermarkets and more likely $3-$4. In some stores, that bread loaf can cost $6-$7!
The bread recipe is largely the same and the ingredients may cost a bit more, so what caused the huge increase in price over the last 90 years or so? The answer is LABOR. when you pay people more, they have more money to spend but everything goes up in price, so most don't actually come out ahead.
Rising labor rates eventually apply to everyone. The very low-end retail clerks got a bump to $15/hr in many places over the last couple of years in order to afford them a more "livable wage".
But those who were already making $15-$20/hr are now asking/demanding more also, so they can maintain their own economic parity. McDonald's workers now start at $18-$20 in my area of the SF Bay. Same for gas station attendants. Target is offering some workers $25/hr starting. Apple retail store workers want $30/hr. Civil service workers make $25-$50/hr now.
The people who got artificially bumped to $15/hr so they could have a more livable wage are STILL at the bottom of the pay totem pole. Pay stratification remains the same as before, except that everything costs more, so there is no savings or gain to the people in the overall economy.
According to FRED, the average hourly wage for nonsupervisory workers was $3.73 per hour in 1971. That means that it would have taken approximately 107 hours of work to afford this refrigerator in 1971. Today, FRED tells us that the average hourly wage is $27.33. That means that it costs the average worker about 24 hours of labor to buy the $663.99 refrigerator today. In terms of time, the refrigerator has become substantially cheaper.
This comparison is largely a story of productivity and economic growth and occurred despite the fact that the money prices have risen substantially over this period."
No, this is story of cheap labor in foreign lands.
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